Oracle's buying spree hasn't ended yet. And while Oracle President Charles Phillips didn't give a timeline for additional activity on the mergers and acquisition front, he did say the company hasn't stopped looking for industry-domain expertise it can add to its applications arsenal.

"There are more acquisitions to come," Phillips said, speaking at Software 2005, a conference of Silicon Valley movers, shakers and hopefuls hosted by top venture capital firm, Sand Hill Group. "Critical mass and scale is essential in this business. And you'll be seeing that in additional acquisitions that can plug into [Oracle's technology]. As we buy companies, we want to make sure they can take advantage of our stack."

Phillips said that many smaller companies are now approaching the Redwood Shores, Calif.-based software vendor about the possibility of being acquired. "A lot of companies are coming to us, saying if we are looking to buy something in their industry, they want it to be them," Phillips said. "We are becoming the buyer of choice."

Two major criteria will determine which companies Oracle buys, Phillips said. One is whether the potential acquiree's technology melds well with Oracle's. The other is if the software fills in a vertical industry hole or adds domain expertise that Oracle wants. In fact, Oracle is adding vertical domain expertise to its E-Business Suite as the opening "wedge" that drives customers to buy Oracle's software, Phillips said. "It's the multiplier effect," he said, describing the notion that customers will buy the underlying applications suite to obtain domain-specific features they need.

This was clearly the reasoning behind Oracle's recent bidding war with SAP over Retek, the applications leader in the retail industry. In that industry battle, SAP said it wanted Retek to complement the retail software it already has. Oracle, in contrast, had no application software for the retail industry.

"Oracle has tremendous problems being industry expert," said Joshua Greenbaum, principal at market research firm Enterprise Applications Consulting. "SAP has had more success at that end."

Phillips also told the audience of nearly 1,000 attendees that it will increase its channel efforts. Currently, 51 percent of Oracle's revenue comes from its partner network. "We now have 7,000 partners and we're growing at 20 percent every year. And we need to be bigger," he said. "We want more partners. We can't cover everything, even if we make a dozen more acquisitions."